Gemfields Plc, the biggest emerald producer, has received interest from jewelery retailers wanting to buy an equity stake since it announced the purchase of Faberge Ltd. last month.
“I’m talking industry champions, national champions and significant global institutions who suddenly realize this is fantastic,” Ian Harebottle, CEO of the London-based mining company, said in a Dec. 7 interview in Lusaka, Zambia’s capital.
Gemfields, which mines emeralds in the southern African nation, plans to double its production of the green gems to 4 million carats over the next five years, he said. The company may produce as many carats of ruby over the same period, Harebottle said.
Gemfields wants to use Faberge to promote colored gems and increase demand for the stones it mines, growing their market share in the jewelry industry. Shareholders will vote on the deal Jan. 7 at a meeting in London, Gemfields said in a statement.
While the U.K.-listed miner has received interest from jewelry retailers from Canada to China, Hong Kong and the U.S., Gemfields is in no hurry to sell a stake, Harebottle said.
“There’s no immediate need for cash,” he said, noting the $36.7 million the company had in the bank as of June 30. “It would have to add strategic value to the continued growth of the business,” for Gemfields to consider selling an equity stake, he said. The company isn’t in any talks regarding that, Harebottle said.
Jewelry makers such as Canada’s Harry Winston Diamond Corp. and Tiffany & Co. have been cutting deals with mines to secure supplies of rough diamonds. Chow Tai Fook, the world’s biggest jewelry retailer by market value, signed a two-year supply agreement with Russian diamond miner Alrosa AO on Nov. 13.
Gemfields, listed on London’s Aim market for smaller companies, plans to graduate to the main market by the end of next year, he said. The move would provide greater exposure to investors.
The company is finalizing a contract with a “Hollywood starlet” and will in March announce who will become the face of Gemfield’s colored stones, as it seeks to replicate the marketing success De Beers enjoyed after Marilyn Monroe recorded “Diamonds are a Girl’s Best Friend”.
Faberge was founded in 1842 in St. Petersburg, and became jeweler to the Russian Imperial Court. The company, famous for the jeweled eggs it made for Russia’s ruling family, may open two stores in as many years, with China, Russia and India being possible hosts, Harebottle said.